Stocks Slide Due to Worldwide Downtrend

The theme of the day in the Australian stock market is slip and slide as the share market abroad showed considerable losses. Bonds offshore fell including the US, Italy, and Spain.

ABS consumer price data for the June quarter shows that the price growth has been sluggish and only grew 1.3 percent this year. The inflation rate is also 1.3 percent which is below the expected target of two to three percent.

• S&P/ASX200 index was down 37.7 points at 4095.5

• All ordinaries index was down 35.9 points at 44125.3

• Aussie dollar versus the US$ is at US$1.024

The weak Aussie dollar is still affected by the news on low manufacturing data, as well as the financial crisis in the eurozone.

HiFX Senior Trader Stuart Ive explains that the purchasing manager’s index (PMI) in Europe is quite weak than expected and might experience another recession. Furthermore a Reuters report was released stating that the International Monetary Fund (IMF) has assessed Greece and found that it will not pass the Troika test.

Rumors ensued that IMF shall stop giving bailouts.

The numbers seem bleak as the stock market in Europe and Asia fell. In Paris, the CAC 40 lost 0.87 percent and in HK, Hang Seng lost 0.8 percent.

On precious and base metals, gold and tin didn’t fare well. Tin closed at 4.5 per cent lower at $17,530 per tonne. However, oil prices slightly went up due to China’s positive manufacturing data. With Brent North Sea crude and New York’s light sweet crude, both being delivered in September, 16 US cents and 36 US cents respectively increased the price a barrel.